Purpose – The purpose of this paper is to explore the notion, and dynamics, of trust between social enterprises and the public sector in two different cultural contexts. The strategy was to ask very simple and broad questions of a number of people in the social enterprise/public sector nexus, and allow them to talk. This talk was recorded and analysed for patterns and insights. This paper looks in detail at one of the insights derived from this wealth of data and makes a startling claim, one that needs further investigation and thought, that in social enterprises, trust precedes performance.
Design/methodology/approach – The research is based on grounded theory and comprises a series of semi-structured interviews based on a common framework undertaken in two countries – the UK and Poland. The interviews were transcribed and then coded by the two teams independently and key insights recorded.
Findings – The research indicated an unsolicited pre-occupation with trust relationships between the
social enterprises and the public sector organisations. The research suggests that trust precedes performance, in that the public sector partner extended a trust relationship before the organisation was able to demonstrate their track record. This challenges EU public procurement rules which require that an organisation demonstrates competency and track record before a contract is let.
Research limitations/implications – Grounded theory by necessity provides insights on which to build theory rather than to prove theory. This research project did not have the resources to develop a questionnaire that could indicate whether the findings are wide spread and therefore robust.
Practical implications – Trust is an under-theorised resource in the literature on social capital.
This research begins to conceptualise trust as an essential resource for social enterprises in the startup, and may prompt social enterprise practitioners to consider trust as a non-financial resource in their business planning. The insights derived from this field provide some notes of guidance to public sector agents working with social entrepreneurs to understand the trust resources required, and the limits to that trust, and the impact of bureaucratisation on the socially entrepreneurial startup.
Originality/value – This paper builds on existing literature on social capital and inter-organisational
trust but extends it in a unique manner to the body of social entrepreneurship literature.